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NBN Co's HFC, FTTC costs now higher than expected

Final part of the build sees numbers spike.

NBN Co saw rises in the cost-per-premises for two-thirds of its access technologies in the first half of FY20, with hybrid-fibre coaxial (HFC) and fibre-to-the-curb (FTTC) costs now higher than the company’s corporate plan forecasts.

The company said today that complexities encountered in the home stretch of the main network build contributed to the higher-than-anticipated numbers.

NBN Co saw its HFC costs rise $154 per premises to $2744 in the last six months of 2019. It had forecast a cost-per-premises (CPP) of $2660 for the full year - FY20 - in its most recent corporate plan.

In addition, FTTC cost-per-premises rose $120 in the last six months of 2019 to $3249, against a corporate plan forecast of $3200.

Fibre-to-the-node (FTTN) and fibre-to-the-basement (FTTB) costs rose $63 per premises to $2331 in the final six months of 2019, marginally under its FY20 forecast number of $2340.

“We are now at the most challenging stage of the build where we are rolling out more complex premises and areas,” NBN Co’s chief financial officer Philip Knox told an earnings call.

“As a result CPP has increased across the HFC, FTTN and FTTC access networks.

“CPP for the HFC and FTTC technologies increased over the past six months, and is above our corporate plan expectations due to greater civil and pit works being required in the later stages of the build, a higher proportion of premises requiring lead-ins to be installed and higher connection costs for activations.

“The growth in FTTN CPP is driven primarily by the increasing percentage of FTTB premises across the build, and higher connection cost for activations.”

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